US food giant Mondelēz fined €337.50 for violating EU antitrust rules

After a five-year investigation, an EU director found that Mondelēz unlawfully restricted retailers from sourcing products from member states where prices were lower, allowing the US packaged food maker to maintain higher prices.

“This harms consumers who pay more for chocolates, cakes and coffee. This is a key issue for European citizens, and is even more obvious in times of very high inflation, when many people are facing a cost of living crisis,” said Commission Vice-President Vestager at a press conference today (23 May).

It announced the imposition of a fine of EUR 337.5 on Mondelēz for violating EU antitrust rules, which prohibit restrictive business practices and abuse of a dominant position – in Art. 101 and 102 of the Treaty on the Functioning of the European Union (TFEU).

The fine was reduced by 15% due to the company’s cooperation with the Commission in the investigation, which enabled the case to be concluded efficiently.

The case concerned Mondelēz’s commercial practices that undermined the so-called parallel trade – when traders buy products in Member States where prices are lower in order to sell them in Member States where prices are higher.

“Parallel trade has huge potential if not restricted. It puts downward pressure on prices,” said Vestager, who is responsible for enforcing competition rules.

The Commission encourages parallel trade as a way to increase consumer choice and keep prices competitive.

Through its practice, which took place between 2006 and 2020, Mondelēz ensured that prices remained high by agreeing with traders whether they could sell in certain EU territories – the Commission identified 11 such separate agreements with seven traders.

At the same time, the American company blocked 11 exclusive distributors operating in some Member States from selling Mondelēz food products to consumers from other EU countries.

The Commission also found an abuse of dominance by removing Côte d’Or chocolate bars from the Dutch market to prevent them from being imported into Belgium, where Mondelēz sold them at higher prices.

The company also prevented a middleman in Germany from buying chocolates in Germany, where they were cheaper, and reselling them in Austria, Belgium, Bulgaria and Romania, where prices were higher.

Contacted by Euronews, a Mondelēz spokesman said that “the decision relates to historic, isolated incidents, most of which had stopped or been remedied long before the Commission’s investigation.”

Many of these incidents concern a very limited part of Mondelēz International’s European business and were related to business transactions with brokers, which are typically conducted through sporadic and often one-off sales, a Mondelēz spokesman said.

The company announced that no further action would be necessary to fund the fine as it had already cleared the funds in 2023.